Huawei Technologies reported a remarkable surge in profit for the year 2023, with its cloud and digital businesses flourishing despite facing U.S. sanctions. The Shenzhen-based company disclosed a net profit of 87 billion yuan ($12 billion), buoyed by robust sales and an enhanced product lineup. Revenue also experienced a notable uptick, climbing nearly 10% from the previous year to reach 704.2 billion yuan ($97.4 billion).
Huawei’s rotating chairman, Ken Hu, expressed satisfaction with the company’s performance, noting that the results were in line with expectations. Despite encountering various challenges in recent years, Huawei has demonstrated resilience and managed to sustain growth.
The company attributed part of its profitability to “gains from the sales of some businesses,” although specific details regarding these transactions were not provided.
Amidst tensions between China and the U.S. concerning technology and security, Huawei has faced restrictions on its operations, including bans on dealings with U.S. companies. These measures have hindered Huawei’s access to essential components such as computer chips and software, impacting its ability to offer certain services and products to customers in the U.S.
In response, Huawei has shifted its focus towards cloud computing services and facilitating digital transformation across various industries. Notably, revenues from its cloud computing business surged by nearly 22% year-on-year in 2023, reaching 55.3 billion yuan ($7.7 billion). Sales in its digital power business also saw growth, expanding by 3.5%, while the automotive services sector witnessed a more than doubling of sales.
Despite these challenges, Huawei’s consumer unit, responsible for selling smartphones and other devices, experienced a notable revenue increase of 17.3% in 2023.
Huawei remains committed to innovation, evident in the launch of its high-end Mate 60 smartphone line, featuring an advanced chip developed in collaboration with China’s Semiconductor Manufacturing International Corporation (SMIC). Looking ahead, Huawei aims to expand its presence in the high-end market by collaborating with ecosystem partners worldwide to introduce more innovative products and services.
However, controversies have arisen regarding Huawei’s chip endeavors, with U.S. lawmakers accusing SMIC of violating sanctions by supplying chips to Huawei. Furthermore, Taiwan launched investigations into local companies suspected of aiding Huawei’s chip efforts, although some of these firms have denied involvement in critical technology-related activities.
Despite these challenges, Huawei remains one of the world’s top investors in research and development, allocating a significant portion of its revenue towards R&D efforts. In 2023 alone, the company invested 164.7 billion yuan ($22.8 billion) into R&D, underscoring its commitment to innovation and technological advancement.
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